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CORA (BLNARU) DESPINA MARIA MASTER ANUL I MANAGEMENT I DEZVOLTARE RURAL

The European Rural Development policy

The European Union has evolved from being a simple international organization that controlled the heavy industry of its members to a multilateral organization focused on many economic, political and social policies. The Common Agricultural Policy (CAP) is one of the oldest and expensive European policies and was one of its core aims. The policy has the objectives of increasing agricultural production, providing certainty in food supplies, ensuring a high quality of life for farmers, stabilising markets, and ensuring reasonable prices for consumers. It was, until recently, operated by a system of subsidies and market intervention. Until the 1990s, the policy accounted for over 60% of the then European Community's annual budget, and still accounts for around 35%. The CAP has been funded from what is known as the European Agricultural Guidance and Guarantee Fund. Traditionally, the vast bulk of resources were devoted to guaranteeing a price for farm produce by intervening in the market. This approach resulted in the EU budget paying to take agricultural produce off the market and into storage. In recent years other mechanisms have included capping production through quotas (e.g. in the milk sector) or by "setting aside" land as well as increased use of direct income support to farmers. Resources have also been devoted to agricultural development and diversification under Structural Funds. Further reform was seen as essential not just to modernise the CAP which already serves agriculture from northern Finland to Southern Portugal but also to prepare for enlargement of the EU to include the countries of Central & Eastern Europe. Budget Even after recent reforms, the CAP still takes up over 40% of EU expenditure. Consumers complained that the system of ensuring farm income by guaranteeing a price per product has meant prices have been kept unnecessarily high. On the other hand, the proportion of EU GDP devoted to agriculture is not untypical of what many national governments have chosen to spend on agriculture in the past. Countries outside the EU (including neighbours like Switzerland and Norway, Japan and the US) still spend a comparable proportion.

Rural Development The CAP has traditionally assumed that helping farmers is the best way to help rural communities. It has had limited success in reversing the trend of rural depopulation and doubts have been expressed about whether large subsidies for big, productive farms have really benefited communities in rural areas. So policy has shifted towards a better balance between supporting farmers and developing the rural community as a whole. Supporters of CAP say that the economic support which it gives to farmers provides them with a reasonable standard of living, in what would otherwise be an economically unviable way of life. However, the EU's small farmers receive only 8% of CAP's available subsidies. Since the beginning of the 1990s, the CAP has been subject to a series of reforms. Initially these reforms included the introduction of set-aside in 1988, where a proportion of farm land was deliberately withdrawn from production, milk quotas (by the McSharry reforms in 1992) and, more recently, the 'de-coupling' (or disassociation) of the money farmers receive from the EU and the amount they produce (by the Fischler reforms in 2004). Agriculture expenditure will move away from subsidy payments linked to specific produce, toward direct payments based on farm size. This is intended to allow the market to dictate production levels, while maintaining agricultural income levels. One of these reforms entailed the abolition of the EU's sugar regime, which previously divided the sugar market between member states and certain African-Caribbean nations with a privileged relationship with the EU. Rural Development policy 2007-2013 With over 56 % of the population in the 27 Member States of the European Union (EU) living in rural areas, which cover 91 % of the territory, rural development is a vitally important policy area. Farming and forestry remain crucial for land use and the management of natural resources in the EU's rural areas, and as a platform for economic diversification in rural communities. The strengthening of EU rural development policy is, therefore, an overall EU priority. The European Union has an active rural development policy because this helps us to achieve valuable goals for our countryside and for the people who live and work there. The EU's rural areas are a vital part of its physical make-up and its identity. According to a standard definition, more than 91 % of the territory of the EU is "rural", and this area is home to more than 56 % of the EU's population. Furthermore, the EU's fantastic range of striking and beautiful landscapes is among the things that give it its character from mountains to steppe, from great forests to rolling fields. Many of our rural areas face significant challenges. Some of our farming and forestry businesses still need to build their competitiveness. More generally, average income per head is lower in rural regions than in our towns and cities, while the skills base is narrower and the service sector is less developed. Also, caring for the rural environment often carries a financial cost. On the other hand, the European countryside has a great deal to offer. It gives us essential raw materials. Its value as a place of beauty, rest and recreation when we look after

it is self-evident. It acts as our lungs, and is therefore a battleground for the fight against climate change. And many people are attracted by the idea of living and/or working there, provided that they have access to adequate services and infrastructure. This means that the EU's Lisbon Strategy for jobs and growth, and its Gteborg Strategy for sustainable development, are just as relevant to our countryside as to our towns and cities. The EU's rural development policy is all about meeting the challenges faced by our rural areas, and unlocking their potential. Theoretically, individual EU Member States could decide and operate completely independent rural development policies. However, this approach would work poorly in practice. Not all countries in the EU would be able to afford the policy which they needed. Moreover, many of the issues addressed through rural development policy do not divide up neatly at national or regional boundaries, but affect people further afield (for example, pollution crosses borders all too easily; and more generally, environmental sustainability has become a European and international concern). Also, rural development policy has links to a number of other policies set at EU level. Therefore, the EU has a common rural development policy, which nonetheless places considerable control in the hands of individual Member States and regions. The policy is funded partly from the central EU budget and partly from individual Member States' national or regional budgets. Structure of rural development policy The essential rules governing rural development policy for the period 2007 to 2013, as well as the policy measures available to Member States and regions, are set out in Council Regulation (EC) No. 1698/2005. Under this Regulation, rural development policy for 2007 to 2013 is focused on three themes (known as "thematic axes"). These are: improving the competitiveness of the agricultural and forestry sector; improving the environment and the countryside; improving the quality of life in rural areas and encouraging diversification of the rural economy. To help ensure a balanced approach to policy, Member States and regions are obliged to spread their rural development funding between all three of these thematic axes. A further requirement is that some of the funding must support projects based on experience with the Leader Community Initiatives. The "Leader approach" to rural development involves highly individual projects designed and executed by local partnerships to address specific local problems.

As before 2007, every Member State (or region, in cases where powers are delegated to regional level) must set out a rural development programme, which specifies what funding will be spent on which measures in the period 2007 to 2013.

A new feature for 2007 to 2013 is a greater emphasis on coherent strategy for rural development across the EU as a whole. This is being achieved through the use of National Strategy Plans which must be based on EU Strategic Guidelines. This approach should help to: identify the areas where the use of EU support for rural development adds the most value at EU level; make the link with the main EU priorities (for example, those set out under the Lisbon and Gteborg agendas); ensure consistency with other EU policies, in particular those for economic cohesion and the environment; assist the implementation of the new market-oriented CAP and the necessary restructuring it will entail in the old and new Member States.

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